Withdraws From RBA to Join Fortescue’s Green Energy Project

By Alan Roberts On Mar 12, 2022

The Reserve Bank’s future has already been thrown into question after widely considered the most probable to promote the rate of interest for the rest of the decade resigned to join private-sector efforts to secure Australia’s green hydrogen future. Dr. Guy Debelle, who has served as deputy governor to Philip Lowe since 2016 and is widely regarded as one of the RBA’s smartest minds, stunned the monetary and fiscal policy community on Thursday by announcing plans to become the chief financial officer of Fortescue Future Industries.

Andrew Forrest, a billionaire, is also the company’s chairman, and his goal is to gradually build green hydrogen and renewable energy projects all over the world. Dr. Debelle, who serves as the chairman of the Council of Financial Regulators’ climate change working group, said that The Age and The Sydney Morning Herald instead of setting the rules for the future, he had such a chance to make real change on environmental issues. “When you look at what’s going on in Australia, Fortescue Future Industries does so much more now than anyone else,” he said.

“Given an opportunity to deal with climate change in this country and elsewhere, this is a fantastic option.” After 34 years with the RBA, the International Monetary Fund, the Bank for International Settlements, and the federal Treasury, this is Dr. Debelle’s first move into the private sector.

Shortly after the election, both parties promised the first independent analysis of the Reserve Bank since the early 1980s. Critics have accused the RBA of its ability to handle the pre-Covid market and, more recently, for its signals regarding long-term interest rate movements.

Dr. Debelle, on the other hand, defended the bank, stating that he had been a representative of the RBA’s rate of interest panel for the past seven years and had sat in on committee meetings for almost 17 years. He did claim that the economic system had improved as a result of the bank’s policy settings. “The economy is in the best condition it has been in for a long time,” he said. “I’m very proud of what we’ve accomplished.”

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RBA Heir Apparent Guy Debelle Quits Unexpectedly to Join Forrest’s Green Hydrogen Play

Dr. Debelle has already been rumored to replace Dr. Lowe, for whom the term as governor expires in 2023. Dr. Debelle said he was “aware” of his potential path to the RBA’s job.

The deputy governor of the bank has traditionally become the institution’s president. Ian Macfarlane, Dr. Lowe, and Glenn Stevens, the previous three governors, all worked as a deputy governor while also serving as the bank’s assistant governor for economics. Luci Ellis currently holds that position, and many believe she may be the first woman to lead the bank since its founding in 1960.

Assistant governor (financial markets) Christopher Kent and assistant governor (financial stability) Michelle Bullock are two other candidates from within the bank. Outside the bank, ex Treasury Secretary Martin Parkinson, who also served on the RBA board while in that position, has been mentioned as a possible candidate if he is willing to return to public service. Luci Ellis, the RBA’s assistant governor, could succeed Guy Debelle as the bank’s first deputy governor.

Bernie Fraser, the former governor appointed from outside the Reserve Bank, was appointed in 1989. Before being decided to move into the bank by then-treasurer Paul Keating, he was the head of Treasury. Dr. Debelle was thanked for his service to the bank by Dr. Lowe. He said, “He has made significant contributions to monetary policy, bank management, and financial market operations.

Dr. Debelle’s resignation was a major setback to Australian monetary policy, according to Stephen Kirchner, president of the International Economy Program at the U. S. Studies Centre at the University of Sydney, but he added that he might return to lead the RBA after the review.

“If a future treasurer receives a survey from an independent review, he could do much worse than invite Guy to carry out the recommendations as governor,” he said. Treasurer Josh Frydenberg, who would be appointing Dr. Debelle’s replacement soon, paid him tribute.

“Dr. Debelle has provided strong economic leadership and helped steer the RBA board’s reactions to the Covid-19 pandemic since his appointment as deputy chair and deputy governor of the RBA board in 2016,” he said.